We came across a bullish thesis on Globant S.A. on Edelweiss Capital Research’s Substack by Javier Pérez. In this article, we will summarize the bulls’ thesis on GLOB. Globant S.A.’s share was trading at $57.49 as of September 22nd. GLOB’s trailing and forward P/E were 23.47 and 9.16, respectively according to Yahoo Finance.
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Globant has experienced a remarkable journey from its origins as a small Argentine startup in 2003 to a global digital services leader, only to face a sharp decline amid broader industry headwinds. Founded by four friends during Argentina’s economic crisis, the company leveraged local talent to serve international clients, achieving a landmark NYSE IPO in 2014. Its early growth was fueled by marquee clients such as Google, Electronic Arts, and Santander, alongside an innovative operating model built around “Studios” and “Pods,” allowing specialized, agile teams to deliver complex digital solutions. Over the years, Globant expanded into diverse industries finance, media, travel, gaming, and hospitality, offering services ranging from AI and cloud implementation to enterprise platforms and digital marketing, while maintaining a decentralized Argentine workforce and a distinctive corporate culture emphasizing innovation and employee engagement.
By 2025, however, the company’s meteoric growth has slowed dramatically, with Q2 revenues up only 4.5% year-on-year and industry-wide pressures, including economic uncertainty and post-pandemic normalization, weighing heavily. Generative AI, while offering efficiency gains through tools like Augmented Coding and AI Pods, poses a dual challenge by potentially reducing demand for human coders and compressing margins. Competition has intensified as peers such as EPAM, Endava, Accenture, and TCS aggressively invest in similar AI capabilities, eroding Globant’s differentiation. High stock-based compensation, once a tool to align employees, now exacerbates dilution amid tight margins, highlighting the tension between growth incentives and shareholder value.
Despite these challenges, Globant retains significant capabilities, a diversified client base, and a reputation for delivering high-value digital transformation projects. While short- to medium-term recovery is plausible, sustaining long-term differentiation and navigating AI-driven industry changes remain critical questions for investors assessing the company’s risk-reward profile.
Previously we covered a bullish thesis on Accenture plc (ACN) by Sanjiv in December 2024, which highlighted the company’s scale in consulting and managed services, strong free cash flow, operational efficiency, and leadership in cloud and generative AI adoption. The company’s stock price has depreciated approximately by 32.62% since our coverage. The thesis still stands as ACN remains a defensive yet innovative player. Javier Pérez shares a similar perspective but emphasizes Globant’s Argentine origins and AI-driven challenges.
